FG Says Nigeria’s Economy Going Into Recession

Nigeria’s economy could shrink as much as 8.9% in 2020 in a worst case
scenario without stimulus, Finance Minister Zainab Ahmed said on
Thursday, a deeper recession than forecast after oil prices plunged due
to the coronavirus pandemic.

Ahmed told the country’s highest economic policy advisory body, the
National Economic Council, that the contraction could reach 4.4% in a
best case scenario, without any fiscal measures.

With stimulus, the contraction can be mitigated and the economy could
shrink by 0.59%, she said.

The coronavirus outbreak and an oil price plunge have magnified
headwinds for the Nigerian economy, which relies on crude sales for
government revenues, triggering an historic decline in growth, creating
large financing needs and weakening the naira.

The finance minister said Nigeria had over 6,000 confirmed cases of the
novel coronavirus which could rise to almost 300,000 by the end of
August. So far only 200 people have died from the outbreak.

“40% of the population in Nigeria, today, are classified as poor. The
crisis will only multiply this misery,” Ahmed told the council via a
virtual meeting.

A World Bank director at the meeting said Nigeria will move into a
recession due to the impact of COVID-19 with severe human and economic
cost but that the bank had planned a proposed package for immediate
fiscal relief for Nigeria.